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4588
BREMERTON AREA CHAMBER OF COMMERCE
Lease w/Purchase Option - 286 4th Street
Econ Devel
LEG 16-3
02/01/2006
06/30/2008
02/15/2010
01/01/2010
Leasehold Tax
Option to Purchase w/in initial 3 yr lease term
LEASE
WITH OPTION TO PURCHASE
This Lease is entered into this )~~ -\h. day of November, 2006, between THE CITY OF
BREMERTON, a municipal corporation, (hereinafter referred to as "Lessor"), and THE
BREMER TON AREA CHAMBER OF COMMERCE, a non-profit corporation, (hereinafter
referred to as "Lessee").
WHEREAS, Lessor owns certain real property and a building situate thereon, and
WHEREAS, Lessee desires to lease a portion of the building for use as general office space
for its operations as a chamber of commerce,
NOW, THEREFORE, the Lessor and Lessee agree as follows:
1. PREMISES. Lessor does, by these presence, lease to the Lessee a portion of a
building situate upon real property located at 286 4th Street, Bremerton, Washington and more
particularly set forth in Exhibit A attached hereto and incorporated by reference. The leased
portion of the building is situated on the main floor (the second level) and consists of
approximately 3,000 square feet of floor area (hereinafter "Premises").
2. TERM. The term of this lease shall be for three years commencing December 1,
2006, ("Commencement Date") and ending November 30,2009, unless otherwise extended or
terminated. If Lessee is compliance with all terms and conditions of this lease, Lessee shall have
one option to extend the term of this lease for an additional two year term. To exercise this
option, Lessee shall delver to Lessor a notice to exercise said option within 90 days prior to the
expiration of the original term of this lease. If Lessee remains in possession of the Premises or
any part thereof after the expiration of the term of this Lease, including any exercised option,
without the express written consent of Lessor, such occupancy shall be a tenancy from month-to-
month which may be terminated by either Lessor or Lessee by delivering written thirty (30) day
notice of termination.
3. CONSIDERATION.
(a) Base Lease Payment. In addition to other consideration of this Lease,
Lessee agrees to pay Lessor, without notice or demand, the sum (based on $8.00 per square foot
annually) of Two Thousand dollars and 001100 ($2,000.00) per month ("Lease Payment"), in
advance, on or before the first day of the first full calendar month of the term hereof and a like
sum on or before the first day of each and every successive calendar month thereafter during the
term hereof.
(b) Leasehold Excise Tax, Other Taxes and Assessments. In addition to the
Base Lease Payment, Lessee shall pay a leasehold excise tax, pursuant to RCW 82.29A.030, on
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Chamber of Commerce
all Lease Payment amounts paid to the City, currently in the amount of 12.84 percent of the base
Lease Payment and as may be adjusted pursuant to Ch. 82.29A RCW. Lessee shall pay the
Leasehold tax with the monthly payment. Lessee shall also pay all taxes assessments, and all
other governmental charges, of any kind whatsoever, applicable or attributable to the Property,
Lessee's leasehold interest, the improvements, or Lessee's use.and enjoyment of the Property.
Lessee shall pay these taxes and assessments when due or as otherwise requested by the Lessor.
4. USE OF PREMISES. Lessee's use and occupancy of the Premises shall be for
general office space for its operations as a chamber of commerce and other related purposes.
5. UTILITIES. Lessor agrees to provide and pay all charges for water and sewer
service. Lessee agrees to provide and pay for all charges for power for the entire building,
garbage pickup, janitorial, telephone and for all other utilities which shall be used in the Premises
during the full term of this Lease.
6. IMPROVEMENTS.
(a) Specifically. Lessee accepts the Premises "as is" except that Lessor will
provide a way to secure access to the second level for safety purposes. Lessee may install signage
subject to Lessor approval.
(b) Generally. Lessee shall not make or allow to be made any alterations,
improvements, or changes to or of the Premises or any party thereof without the prior written
consent of Lessor, and all improvements, alterations, or changes so made shall become a part of
the lease Premises and shall belong to Lessor upon expiration or sooner termination of this
Lease. With respect to such alterations, improvements or changes to the Premises requested by
Lessee, Lessor's consent shall not be unreasonably withheld. In the event Lessor consents to the
making of any alterations, additions, or improvements to the Premises by Lessee, the same shall
be made by Lessee at Lessee's sole cost and expense, the Premises and Lessee's leasehold interest
therein shall remain free from any lien of any kind whatsoever, and construction of such
alterations, additions or improvements shall be done in compliance with all laws and
governmental requirements by qualified city staff or licensed and bonded contractors.
7. MAINTENANCE AND REPAIRS.
(a) Lessee's Obligations. By taking possession of the Premises, Lessee shall
be deemed to have accepted the Premises as being clean and in good order, condition, and repair.
Lessee shall, at Lessee's expense, keep the Premises and every part thereof in good condition and
repair (except as hereinafter provided with respect to Lessor's obligations set forth in paragraph
7 .(b) below). Lessee shall, upon the expiration or sooner termination of this Lease, surrender the
Premises to Lessor in good condition, clean, excepting only ordinary wear and tear and
destruction or damage by such conditions over which Lessee has no control, or such damage as
may be due to the failure of Lessor to comply with any covenant herein contained to be
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Chamber of Commerce
performed by Lessor. Damage caused by Lessee's use of the Premises shall be repaired at the
sole cost and expense of Lessee.
(b) Lessor's Obligations. Lessor shall, at Lessor's expense, repair and
maintain the structural portions of the Building, including the roof, foundation, bearing and
exterior beams and supports and exterior walls (excluding glass), structural flooring and
subflooring, plumbing, pipes, electrical wiring and conduits within and serving the premises.
There shall be no abatement of Rent and no liability for Lessor by reason of any injury to or
interference with Lessee's business arising from the making of any repairs, alterations, or
improvements in or to any portion of the Building or the Premises or in or to fixtures,
appurtenances, and equipment if Lessor shall have taken every reasonable measure to avoid any
such injury and interference.
8. LIENS. Lessee shall keep the Premises, Lessee's leasehold interest therein and
the Building and Land on which the Premises are situated free from any liens arising out of any
work performed, materials furnished, or obligations incurred by Lessee.
9. INDE:MNIFICATION. Lessee shall indemnify, defend and hold Lessor
harmless from all loss damage, liability or expense resulting from any injury to any person or any
loss of or damage to any property caused by or resulting from any act or omission of Lessee or
any officer, agent, employee, guest, invitee or visitor of Lessee in or about the Premises or the
Building, but the foregoing provision shall not be construed to make Lessee responsible for
injuries to third parties caused by the negligence of Lessor or any officer, agent, employee, guest,
invitee or visitor of Lessor. Lessor shall not be liable for any loss or damage to person or
property sustained by Lessee, or other persons, which may be caused by theft or any act of
neglect of Lessee or occupant of the building, or of any other person, or by any other cause,
unless caused by the negligence of Lessor or its officers, licensees, agents, employees, guests,
invitees or visitors.
10. LIABILITY INSURANCE; HAZARD INSURANCE.
(a) Liability Insurance. Lessee, at its own expense, shall provide and keep
in force comprehensive general liability insurance in the amount of not less than One Million
Dollars ($1,000,000.00 per occurrence for bodily injury and property damage. Lessee shall
furnish Lessor with a certificate of such policy within thirty (30) days of the Commencement
Date of this Lease and whenever required shall satisfy Lessor that such policy is in full force and
effect. Such policy shall name Lessor as an additional insured and shall be primary and
noncontributing with any insurance carried by Lessor. The policy shall further provide that it
shall not be canceled without twenty (20) days prior written notice to Lessor.
(b) Hazard Insurance. Throughout the term of this Lease, Lessor shall
procure and maintain fire, hazard and extended coverage insurance on the Improvements.
Should the property become uninhabitable due to loss or become uninhabitable for any other
reason the City shall have the option of terminating this lease.
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Chamber of Commerce
11. PERSONAL PROPERTY. Where furnished by or at the expense of Lessee, all
movable property, furniture, furnishings and trade fixtures, other than those affixed to the
Premises so that they cannot be removed without material damage, shall remain the property of
and be removable by Lessee, and in case of damage by reason of such removal, Lessee shall
restore the Premises, Building or common areas to good order and condition. Lessee shall payor
cause to be paid before delinquency any and all taxes levied or assessed and which become
payable during the term hereof upon all Lessee's Improvements, equipment, furniture, fixtures,
and other personal property located in the Premises. Lessee shall be responsible for all personal
property insurance coverage during the term of this Lease.
12. ENTRY BY LESSOR. At any and all reasonable times during regular business
hours, upon one (1) day's prior notice to Lessee, Lessor reserves and shall have the right to enter
the Premises to inspect the same a reasonable number of times, to submit the Premises to
prospective purchasers or Lessees, to repair the Premises and any portion of the Building that
Lessor may deem necessary or desirable, without abatement of Rent, and may for the purpose
erect scaffolding and other necessary structures where reasonably required by the character of the
work to be performed, always providing that the entrance to the Premises shall not be blocked
thereby and further providing that the business of Lessee shall not be interfered with
unreasonably. Lessee hereby waives any claim for damages or for any injury or inconvenience to
or interference with Lessee's business or any loss of occupancy or quiet enjoyment of the
Premises, and any other loss occasioned thereby, if Lessor shall have taken every reasonable
measure to avoid any such injury, inconvenience or interference. Lessor shall have the right to
use any and all means which Lessor may deem proper to open any doors or otherwise obtain
access to the Premises in an emergency, without liability to Lessee except for any failure to
exercise due care for Lessee's property, and any entry to the Premises obtained by Lessor by any
of said means or otherwise shall not under any circumstances be construed or deemed to be a
forcible or unlawful entry into or a detainer of the Premises or an eviction of Lessee from the
Premises or any portion thereof.
13. ASSIGNMENT AND SUBLETTING. Lessee shall not either voluntarily or by
operation of law assign, transfer, mortgage, pledge hypothecate, or encumber this Lease or any
interest therein and shall not sublet the Premises or any part thereof or any right or privilege
appurtenance thereto or allow any person (the employees, agents, servants, and invitees of Lessee
excepted) to occupy or use the Premises or any portion thereof, without the prior written consent
of Lessor, which consent by Lessor shall not be unreasonably withheld. Any such assignment or
subletting without compliance with the terms of this paragraph shall be void and shall, at the
option of Lessor, constitute a default under the terms of this Lease. Consent to one assignment,
subletting, occupation, or use by any other person shall not be deemed to be a consent to any
subsequent assignment, subletting, occupation, or use by another person. Consent to any such
assignment or subletting shall in no way relieve Lessee of any liability under this Lease. Lessor
may assign the Rent herein provided to any person, partnership, corporation, or bank, and Lessee
agrees when notified in writing by the assignee of such assignment to make the Rent payments to
assignee under the terms of said assignment.
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Chamber of Commerce
14. LESSEE'S DEF AUL T. The occurrence of anyone or more of the following
events shall constitute a default and breach of this Lease by Lessee.
(a) Abandonment. Lessee vacates or abandons the Premises;
(b) Failure to Pay Lease Payment. Lessee fails to make any payment of the
Lease Payment or any other payment required to be made by Lessee hereunder;
(c) Failure to Observe Other Covenants. Lessee fails to observe or perform
any of the covenants, conditions, or provisions of this Lease to be observed or performed by
Lessee where such failure shall continue for a period of thirty (30) days after written notice
thereof by Lessor to Lessee; provided, however, that if the nature of Lessee's default is such that
more than thirty (30) days are reasonably required for such cure, then Lessee shall not be deemed
to be in default if Lessee commences such cure within said thirty (30) days and thereafter,
diligently prosecutes such cure to completion.
15. REMEDIES ON DEFAULT.
(a) Termination. In the event Lessee fails to cure such default, Lessor may,
at any time thereafter, terminate this Lease by written notice to Lessee. Lessor may also seek any
other remedy provided by law.
(b) Removal of Personal Property. In the event of a retaking of possession
of the Premises by Lessor, Lessee shall remove all personal property located thereon and upon
failure to do so upon demand of Lessor, Lessor may remove and store the same in any place
selected by Lessor, including but not limited to a public warehouse, at the expense and risk of
Lessee. If Lessee shall fail to pay the cost of storing any such property after it has been stored for
a period of thirty (30) days or more, Lessor may sell any or all of such property at a public or
private sale and shall apply the proceeds of such sale first to the cost of such sale, secondly to the
payment of the charges for storage, if any, and thirdly to the payment of any other sums of money
which may be due from Lessee to Lessor under the terms of this Lease, and the balance, if any, to
Lessee. Lessee hereby waives all claims for damages that may be caused by Lessor's lawfully
reentering and taking possession of the Premises or lawfully removing and storing the property of
Lessee as herein provided and will save Lessor harmless from loss or damages occasioned by
Lessor thereby, whether such lawful reentry shall be considered or construed to be a forcible
entry.
(c) Remedies Cumulative. The remedies hereinafter described shall be
cumulative and Lessor shall be entitled to pursue any other remedy now or hereafter available to
Lessor under the law or judicial decisions of the State of Washington.
16. LESSOR'S DEF AUL T. Lessor fails to observe or perform any of the covenants,
conditions, or provisions of this Lease to be observed or performed by Lessor, where such failure
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Chamber of Commerce
shall continue for a period of thirty (30) days after written notice thereof by Lessee to Lessor;
provided, however, that if the nature of Lessor's default is such that more than thirty (30) days
are reasonably required for such cure, then Lessor shall not be deemed to be in default if Lessor
commences such cure within said thirty (30) days and thereafter, diligently prosecutes such cure
to completion. In the event Lessor fails to cure such default, Lessee may, at any time thereafter,
terminate this Lease by written notice to Lessor. Lessee may also seek any other remedy provided
by law.
17. EMINENT DOMAIN. If the whole of the Premises (or the whole or part of the
Building or Improvements) shall be acquired or condemned by eminent domain for any public or
quasi-public use, or if a part of the Premises is so taken so that the Premises are rendered
unsuitable for the business of Lessee, then the term of this Lease shall terminate as of the date
title or possession shall be transferred in such proceeding, whichever shall occur first. In the
event of a partial taking or condemnation which is not extensive enough to render the Premises
unsuitable for the business of Lessee, then Lessor shall restore the Premises to a condition
comparable to its condition immediately prior to such taking less the portion lost in the taking,
and this Lease shall continue in full force and effect provided, however, that the monthly Rent
shall abate in the same ratio that the portion of the Premises so taken bears to the whole of the
Premises.. Lessor shall have the right to receive the compensation of damages awarded upon
either such total or partial taking and Lessee shall have no claim thereto; provided that Lessee
may independently pursue an award or compensation to Lessee for the taking of Lessee's
personal property or fixtures or for the interruption of or damage to Lessee's business and for any
other interest of Lessee.
18. HAZARDOUS SUBSTANCES. Lessee shall not generate, release, spill, store,
deposit, transport, or dispose of (collectively "Release") any hazardous substances, sewage,
petroleum products, hydrocarbons, radioactive substances, medicinal, bacteriological, or disease-
producing substances, hazardous materials, toxic substances or any pollutants or substances
defined as hazardous or toxic in accordance with applicable federal, state, and local laws and
regulations ("Hazardous Substances") in, on or about the Premises. Lessee shall indemnify,
defend and hold Lessor harmless from any and all claims, liabilities, losses, damages, cleanup
costs, response costs, and expenses (including reasonable attorneys' fees) arising out of or in any
way related to the Release by Lessee, or any of its agents, representatives, or employees, or the
presence of such Hazardous Substances in, on or about the Premises occurring at any time after
the Commencement Date and arising out of the activities of Lessee, or any of its agents,
representatives or employees. The provisions of this paragraph shall survive termination or
expiration of this Lease.
19. OPTION TO PURCHASE. Lessee shall have the option to purchase the real property
and building situate thereon anytime during the initial three (3) lease term. Purchase price shall be
$360,000.00 as established by the existing AC.E. PS, Inc. appraisal. To exercise this option, Lessee must
provide written notice to Lessor prior to expiration of the initial three year lease term.
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Chamber of Commerce
20. GENERAL PROVISIONS. Lessor and Lessee agree to the following general
provIsIOns:
(a) Waiver. No waiver of default by either party of any of the terms,
covenants and conditions hereof to be performed, kept and observed by the other party shall be
construed as, or operate as, a waiver of any subsequent default of any of the terms, covenants and
conditions herein contained, to be performed, kept and observed by the other party. The
subsequent acceptance of Rent hereunder by Lessor shall not be deemed to be a waiver of any
preceding default by Lessee of any term, covenant, or condition of this Lease other than the
failure of Lessee to pay the particular rental so accepted, regardless of Lessor's knowledge of
such preceding default at the time of the acceptance of such Rent.
(b) Time. Time is of the essence of this Lease and each and all of its
provisions in which performance is a factor.
(c) Paragraph Headings. The paragraph or section headings of this Lease
are not a part of this Lease and shall have no effect upon the construction or interpretation of any
part hereof.
(d) Successors and Assigns. The covenants and conditions herein contained,
subject to the provisions as to assignment, apply to bind the heirs, successors, executors,
administrators, and assigns of the parties hereto.
(e) Recordation. Neither Lessor nor Lessee shall record this Lease, but a
short form memorandum hereof may be recorded at the request of Lessor.
(f) Quiet Possession. Upon Lessee paying the Rent reserved hereunder and
performing all of the covenants, conditions, and provisions on Lessee's part to be observed and
performed hereunder, Lessee shall have quiet possession of the Premises for the entire term
hereof, subject to all the provisions of this Lease. The Premises are leased subject to any and all
existing encumbrances, conditions, rights, covenants, easements, restrictions, rights-of-way, and
any matters of record, applicable zoning and building laws, and such matters as may be disclosed
by inspection or survey.
(g) Prior Agreements. This Lease contains all of the agreements of the
parties hereto with respect to any matter covered or mentioned in this Lease and no prior
agreements or understandings pertaining to any such matters shall be effective for any purpose.
No provision of this Lease may be amended or added to except by agreement in writing signed by
the parties hereto or their respective successors in interest. This Lease shall not be effective or
binding upon any party until fully executed by both parties hereto.
(h) Inability to Perform. The time period within which any party is to fulfill
an obligation of such the party under this Lease shall be extended by such time period that any
party is unable to fulfill any of its obligations hereunder or is delayed in doing so, if such
7
Chamber of Commerce
inability or delay is caused by reason of strike, labor troubles, acts of God, or any other cause
beyond the reasonable control of such party.
(i) Severability. Any provisions of this Lease which shall prove to be
invalid, void, or illegal shall in no way affect, impair, or invalidate any other provision hereof
and such other provision shall remain in full force and effect.
(j) Cumulative Remedies. No remedy or election hereunder shall be deemed
exclusive but shall whenever possible be cumulative with all other remedies at law or in equity.
(k) Choice of Law. This Lease shall be construed under all of the applicable
laws, statutes, ordinances, rules and regulations of the United States, the State of Washington,
County of Kitsap, and the City of Bremerton. In the case of a dispute between the parties, venue
over such dispute shall be with the Superior Court of Kitsap County, Washington.
(I) Execution. This Lease may be executed in several counterparts, each of
which shall be deemed an original instrument.
(m) Notices. All notices to be given hereunder shall be in writing and shall be
personally delivered and receipt acknowledged, sent by United States certified mail, return
receipt requested, sent by facsimile, with original delivered within three (3) days, or sent by
overnight delivery through public or private service, delivery charge prepaid, and addressed to
the party at the respective mailing address as herein set forth.
To Lessor:
Mayor
City of Bremerton
345 6th Street, Suite 600
Bremerton, W A 98337
To Lessee:
E'XfJc..ul:; lie.. Dif'l"..JiJ'r
Bremerton Area Chamber of Commerce
286 4th Street
Bremerton, W A 98337
It is understood that each party may change the address to which notice may be sent by giving a
written notice of such change to the other party hereto in the manner herein provided.
(n) Lessee's Corporate Authority. Lessee is a Washington corporation, and
each individual executing this Lease on behalf of said corporation represents and warrants that he
or she is duly authorized to execute and deliver this Lease on behalf of said corporation, in
accordance with a duly adopted resolution of the board of directors of said corporation or in
accordance with the bylaws of said corporation, and that this Lease is binding upon said
8
Chamber of Commerce
corporation in accordance with its terms. Lessee further represents and warrants that it is fully
registered and qualified to do business in the State of Washington.
IN WITNESS WHEREOF, the parties hereto have executed this Lease the day and year
first above written.
LESSOR
LESSEE
CITY OF BREMERTON
BREMERTON AREA CHAl\1BER OF
COMMERCE
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Its: Mayor
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9
Chamber of Commerce
STATE OF WASHINGTON)
) ss.
COUNTY OF KITSAP )
I certify that I know or have satisfactory evidence that CARY BOZEMAN is the person who
appeared before me, and said person acknowledged that he signed this instrument, on oath stated
that he was authorized to execute the instrument, and acknowledged it as the Mayor of the City
of Bremerton to be the free and voluntary act of such City for the uses and purposes mentioned in
the instrument.
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voluntary act of such Corporation for the uses and purposes mentioned in the instrument.
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10
Chamber of Commerce
EXHIBIT A
LEGAL DESCRIPTION
Lot 3 and the west 17/1 oath (.17) of a foot of Lot 4, Block 6, Plat of
the Town ofBremerton, according to the plat thereof, Kitsap County,
Washington and recorded in Volume 2 of Plats, Page 30, records of
said county.
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Chamber of Commerce
DATE SUBMITTED: November 3, 2006
BILL# 06 - ;;;..47
AGENDA BILL
CITY OF BREMERTON
CITY COUNCIL
........................................................................................
SUBJECT: Lease Agreement between the
City of Bremerton and the Bremerton Area
Chamber of Commerce.
Committee Meeting Date: Nov. 8,2006
COUNCIL MEETING Date: Nov. 15, 2006
Department: Economic Dev.
Presenter: Gary Sexton
Phone: 473-5282
SUMMARY: The Bremerton Area Chamber of Commerce is asking to lease approximately 3,000
square feet at the Permit Center Building, located at 286 4th Street. The monthly rent will be
$2,200.00/month with annual CPI adjustments.
A TT ACHMENTS: Letter of Intent to Lease
FISCAL IMPACTS (Include Budgeted Amount): None
.(f
\'
f
~~
APPROV ALS:
DEPARTMENT DIRECTOR:
CITY ATTORNEY:
FINANCE DIRECTOR:
MAYOR:
FISCAL/BUDGET:
OPERATIONS:
COUNCIL PRESIDENT:
Cii./i.'/ . ,~
lY~~ /
I CONSENT AGENDA ~ I
RECOMMENDED MOTION: Move to approve a lease agreement between the City of Bremerton
and the Bremerton Area Chamber of Commerce and authorize the Mayor to finalize and execute a
lease based on the terms and conditions as set forth in the Letter of Intent to Lease.
COUNCIL ACTION: ~pprove
o Deny
o Table
o Continue 0 No Action